Purpose

To consolidate, disseminate, and gather information concerning the 710 expansion into our San Rafael neighborhood and into our surrounding neighborhoods. If you have an item that you would like posted on this blog, please e-mail the item to Peggy Drouet at pdrouet@earthlink.net

Thursday, June 5, 2014

China’s investment in Los Angeles County has doubled in last 5 years, new report says

The ports of Los Angeles and Long Beach maintained their ranking as
the nation’s top gateway for international trade last year and container
traffic through the twin ports is expected to rise 5.5 percent this
year and 5.8 percent in 2015.

Those are just some of the findings
included in a pair of reports to be released today by the Los Angeles
County Economic Development Corp.

The LAEDC’s “International Trade
Outlook for the Southern California Region 2014-2015” examines the
Southland’s trade sector from a broad perspective, and “Growing
Together: China and Los Angeles County” speaks to the growing trade
synergy between Southern California and China.
The latter report notes that investment into Los Angeles County
from China has doubled over the past five years, with China becoming one
of the county’s top investors.

And tourism nearly quadrupled in
recent years from 158,000 Chinese tourists in 2009 to 570,000 in 2013,
making China the top overseas market for Los Angeles tourism.

Much
of the growth in those areas has been fueled by the fact that Los
Angeles County has the largest Chinese population of any county in the
nation and the largest number of Chinese students.

“International trade is a significant industry for our local
economy because we are the gateway to the U.S.,” said Robert Kleinhenz,
the LAEDC’s chief economist. “It always ranks among the top three
industries for Southern California from one year to the next, and it
competes with entertainment.”

The ports of Los Angeles and Long
Beach posted a strong year in 2013 with a combined increase in cargo of
roughly 3 percent, primarily because of a stronger than expected peak
season and stronger than anticipated activity in November and December.

Growth trends between the two ports have shifted as a result of
shippers forming alliances to allow cargo volumes to move more fluidly
between the two destinations. Because of that, total loaded cargo volume
at the Port of Los Angeles was down by about 4 percent in 2013, but it
was up more than 12 percent at the Port of Long Beach.

“The
alliance allows multiple shippers to share space on their ships
regardless of the port of call,” Kleinhenz said. “So it may be
advantageous in some cases for a company to put all of their stuff on
one ship as opposed to having separate ships. We tend to pay less
attention to the trends at individual ports and look more at the overall
activity of both ports for that reason.”

Disparities aside, the two ports still maintained their top two
rankings in the U.S. in 2013, handling a total of 14.6 million
containers — a 3.4 percent increase over the previous year.

More than 40 percent of the nation’s imported containers pass through the ports of Los Angeles and Long Beach.

The
Los Angeles Customs District (LACD) — which includes the two ports and
Los Angeles International Airport and Ontario International Airport —
also maintained its top position in the U.S. last year with a two-way
trade value of $414.5 billion. Los Angeles International Airport
contributed to that total with $91.6 billion in air cargo.

In 2013, the value of total two-way trade at the LACD increased by 2.7 percent on a year-over-year basis.

The
China report notes that over the past 30-plus years trade (goods only)
between the U.S. and China jumped from about $4.8 billion to $562
billion. U.S. exports to China have likewise grown from $3.8 billion to
$122 billion in 2013.

LACD exports to China have grown by more
than 52 percent since 2009, setting records at the Port of Los Angeles
in 2010 and 2011 in both value and the number of containers.

“That is the important message,” said Ferdinando Guerra, an
international economist with the LAEDC. “That gap between imports and
exports is decreasing, and that’s important.”
Last year the value of LACD exports to China totaled nearly $22 billion, well below the $147.3 billion in imports.
“We’ll
continue to see that gap narrow because wages are rising in China and
we’ll be importing more products from countries like Vietnam,” Guerra
said. “(Vietnam is) about where China was 10 to 20 years ago in their
economic development.”

Computers, machinery, appliances and parts topped the LACD’s 2013
export list to China with a value of $4.7 billion. That was followed by
electrical equipment, TVs and electronic parts ($3.8 billion), plastics
and items made of plastic ($2.8 billion) and motor vehicles and motor
vehicle parts ($2.3 billion), among others.

Top imports included
computers, machinery, appliances and parts ($41.8 billion), electrical
equipment, TVs and electronic parts ($40.6 billion) and furniture,
bedding and lamps ($11.1 billion).
China was the LACD’s top trading partner in 2013, followed by Japan, South Korea, Taiwan, Germany and Vietnam.

Many
have speculated that the widening of the Panama Canal will reduce local
trade activity because it will provide larger cargo ships with a
quicker route to East Coast ports. The expansion is expected to be
completed by the end of 2015 or early 2016.

Guerra admitted that is a concern, but he said those fears are largely overblown.

“We
won’t have a significant loss in traffic from that, maybe 5 to 10
percent,” he said. “And we may be get larger exports from outside ports
that could negate some of those losses.”